There haven't been many moments in the last couple of decades when contemporary classical music became a national scandal. But on September 16 1995, Harrison Birtwistle achieved the sort of notoriety usually only dreamed of by classical composers. Birtwistle's newest work, Panic, was premiered that night as part of the second half of the Last Night of the Proms at the Royal Albert Hall, broadcast to millions of viewers on BBC1. It was a pulverising piece of uncompromising energy - the first piece of contemporary music ever to have appeared on a Last Night programme. It caused a stink on the BBC's audience line. Instead of an evening of comforting, patriotic fervour, audiences were presented with violent contemporaneity. Some of the watching millions felt personally offended. "The Harrison Birtwistle piece was a disgrace and an insult to the British public," ranted one viewer. The Daily Mail and Daily Express joined in, calling it "a horrible cacophony" and "unmitigated rubbish".

But the real story behind the Panic panic - excuse the pun - reveals the complexities of the relationship that the Proms have had with new music throughout their 112-year history. Far from being an iconoclastic masterstroke by the Proms' then director, John Drummond, the programming of Panic lies squarely in a Proms tradition that's even more venerable than the calcified cadaver that is the Last Night. When Robert Newman and Henry Wood began the Proms at the Queen's Hall in 1895, they were men on a musical mission: not just to fill the hall every night with the new class of audience who were able to buy promenade tickets so cheaply, but also to entertain and educate them.

That education was twofold: to develop familiarity with the symphonic works of the Austro-German canon and to introduce "novelties", as Wood called new pieces, to the public. The strategy, from the start, was a cunning one. To sweeten the pill, serious symphonies and experimental works were played alongside crowd-pleasing favourites. It was an early version of the sort of mixed programming that is still commonplace at the Proms.

Some of Wood's "novelties" were genuinely avant-garde. In 1912, for example, he conducted the first-ever performance of Schoenberg's Five Orchestral Pieces, still one of the most challenging works in the repertory. The piece was hissed in the Queen's Hall (the Proms venue until it was bombed in the Blitz in 1941), but Wood was sufficiently impressed to ask Schoenberg himself to conduct it the following winter. And that's what the Proms have always done, turning what seem at first like forbidding or unfamiliar works into staples.

All of which brings us back to Panic. After the cause célèbre of its premiere, Panic was performed around the world. The lesson of both the Panic furore and the Schoenberg controversy is that you need strokes of programmatic boldness to ensure that the dual traditions of the Proms, for entertainment and experimentation, continue to flourish. In Nicholas Kenyon's years as controller (this is his last season; Roger Wright, controller of Radio 3, takes over next year) the watchwords have been consolidation and collaboration rather than radicalism or revolution. But this year's performance of Birtwistle's music should remind us that the Proms concerts and their audiences need the energising shock of the new, if the series is not to stagnate.

· Panic will be performed by the BBC Scottish Symphony Orchestra under Martyn Brabbins at Prom 44 at the Royal Albert Hall, London, on August 16. Box office: 020-7589 8212